Indian economy continued to display strength amid buoyant domestic demand buoyant

Reserve Bank of India (RBI) stated in a latest update that the Indian economy continued to display strength notwithstanding global headwinds. Domestic demand remained buoyant, as reflected by several indicators, including vehicle and tractor sales. Petroleum product consumption growth returned to positive territory, after three straight months of contraction. Industrial production strengthened sharply in June, recording its strongest growth in nearly two years, supported by a broad-based acceleration in manufacturing. The services sector also exhibited resilience. Both merchandise exports and imports grew strongly in July 2026 with exports growing at a four- month high (in 2026-27 so far). Merchandise trade deficit widened in July, both sequentially and on a year-on-year ( y-o-y) basis, reflecting a widening of deficit in electronic goods. RBI further stated that the pick-up in monsoon activity during July supported kharif sowing, taking it closer to the previous year?s level. Backed by a high stock of public foodgrains, the government has also announced an Open Market Sales Scheme for the current financial year to augment supply.

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